BUSINESS + ECONOMY

Biden to address nation from Oval Office after avoiding catastrophic default

Jun 2, 2023, 4:48 PM | Updated: Jun 22, 2023, 4:44 pm

When news broke of a shooting at an elementary school in Uvalde, Texas, one year ago, President Joe...

FILE: President Joe Biden makes a statement about the school shooting in Uvalde, Texas, shortly after he returned to Washington from his trip to South Korea and Japan, at the White House in Washington, May 24, 2022. (Kevin Lamarque/Reuters via CNN)

(Kevin Lamarque/Reuters via CNN)

Washington (CNN) — President Joe Biden will address the nation from the Oval Office on Friday evening – his first time speaking to the country directly from that setting – following congressional passage of a compromise measure that raises the federal borrowing limit and avoids a catastrophic default.

In his remarks, Biden will tell Americans the package ensures economic progress going forward.

“That’s why I’m speaking to you tonight. To report on a crisis averted and what we are doing to protect America’s future. Passing this budget agreement was critical. The stakes could not have been higher,” he will say, according to excerpts of his speech released by the White House.

The decision to speak in the most formal of presidential settings comes after weeks of fraught negotiations over the borrowing limit. The deal ultimately struck between Biden and House Speaker Kevin McCarthy raises the debt ceiling for two years, freezes domestic spending, imposes some new work requirements on food stamps and alters certain energy permitting rules.

Biden has intentionally avoided declaring victory after brokering the agreement, partly in the hopes of securing the necessary Republican votes for the bill to pass.

That tactic appeared to work; the measure cleared the House and Senate in bipartisan fashion. Biden is expected to sign the bill into law before the end of the weekend.

“No one got everything they wanted but the American people got what they needed. We averted an economic crisis and an economic collapse,” the president will say.

“We’re cutting spending and bringing deficits down,” Biden will say. “And, we protected important priorities from Social Security to Medicare to Medicaid to veterans to our transformational investments in infrastructure and clean energy.”

The Treasury Department has said it will run out of cash to pay its bills in full and on time on Monday. Economists had warned of severe consequences of a national default.

Despite the bill’s passage, the legislation known as the Bipartisan Budget Agreement had detractors on both the left and right. Many liberals and conservatives voted against it, and the most right-wing lawmakers have raised the prospect of trying to oust McCarthy from his leadership role for what they say were insufficient spending cuts.

On the left, progressive Democrats balked at some of the new work requirements added to the bill, though an analysis by the nonpartisan Congressional Budget Office showed the measure would likely keep the number of Americans on food stamps at roughly the same levels. The bill lifted work requirements for veterans and those experiencing homelessness.

Democratic critics have also voiced outrage at approval included in the bill of a natural gas pipeline through West Virginia and Virginia.

Biden and his aides have argued they were successfully able to stave off the most extreme Republican positions to arrive at a bill that ultimately avoided economic disaster.

Through it all, some Democrats have grumbled at the president’s approach to the situation. While Biden initially said he would not negotiate over raising the debt ceiling, demanding only a “clean increase,” he ultimately entered into talks with McCarthy that tied the borrowing limit to budget cuts.

Others encouraged Biden to use the 14th Amendment, which states the US debt “shall not be questioned,” to unilaterally raise the debt ceiling. Biden said it was possible to explore that option in the future, but it was too risky to deploy with the imminent threat of default.

In his speech, Biden is likely to discuss the process that led to the agreement and how he plans to move forward, people familiar with the speech said.

Oval Office addresses are often used for matters of grave national importance, including security matters. The setting offers an air of authority and familiarity to viewers accustomed to hearing a president begin his remarks: “My fellow Americans.”

Yet the past two presidents largely eschewed the Oval Office for addresses to the nation, finding the format somewhat stilted. Biden will have a chance to test the venue himself for the first time Friday.

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Biden to address nation from Oval Office after avoiding catastrophic default